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option for organizations as they upgrade their on-premises infrastructure. But cloud subscription costs can vary and offer different functionalities. In this podcast, ZK Research principal analyst Zeus Kerravala explains how subscription costs differ among UC cloud services, like unified communications as a service and communications platform as a service.

On the surface, unified communications as a service and communications platform as a service are both unified communications services and cloud-based, but they are fundamentally different.

If you think about the evolution of communications, we went from having an on premises PBX to an on-premises IP PBX. But then we took the entire PBX functionality and pushed it up into the cloud. Now there are literally hundreds of unified communications as a service (UCaaS) providers and what they offer is the opportunity to buy a full PBX from the cloud. So, it looks like what you had before -- a full phone system with caller ID, attendant consoles, call waiting and voicemail. It's just available from the cloud instead of on-premises.

The next evolutionary step is what's known as communications platform as a service (CPaaS). Think of it as modules of PBXs that are being sold today instead of the full PBX. If you're a mobile developer working for an airline and you're building their mobile app, if you want a user to be able to click-to-call, historically you would need to buy a full PBX to be able to do that, but now you can just buy that module of the PBX. It's really modules of unified communications. So, I can get chat, video capabilities, or SIP trunking lines, but, in essence, instead of buying the full PBX, I'm buying a piece of a PBX.

Now, this is where the difference comes in as far as cloud subscription costs go. With UCaaS, I'm buying the full PBX. What I'm paying for is a per user, per month fee, typically on a per bundle. The cloud provider may put together different bundles for remote workers, office workers, or telecommuters and they package up a bunch of services. They charge you some amount of dollars per month, per user.

With CPaaS, you're paying by the unit. You're going to be paying for every SMS that's sent or every minute of calling. You're not paying per user, you can have as many users as you want, but you're paying for the volume of whatever communication you're consuming. In a lot of ways this makes sense because this now becomes more customer-facing in nature.

But that's really the fundamental difference: If you're using a UCaaS solution you're paying a per user fee to have access to everything that the cloud provider offers. If you're using CPaaS, you're paying for that unit, that module, and then the usage of it.

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